Smart grid is still an option

National Grid tells regulators it may aim for scaled-down plan

By Larry RulisoN Business writer

Published 1:00 am, Wednesday, November 25, 2009

ALBANY — National Grid is not giving up on its plans for a "smart grid" demonstration project in upstate New York.

The London-based utility recently lost out on $200 million in federal stimulus funding it was seeking for projects in New York and New England that would have allowed it to test new technologies such as advanced meters and plug-in electric cars that make up what's generally called the "smart grid."

The New York portion of the project — expected to cost $250 million — would have taken place in Saratoga County and a small portion of Schenectady County, as well as parts of the Syracuse area.

Half the funding would have come from the Department of Energy through the stimulus package, and the other half would have come from utility customers.

However, National Grid was not among the chosen when President Barack Obama announced $3.4 billion in smart grid funding for 100 projects across the country on Oct. 27.

But National Grid is now telling state regulators that it may try to do a scaled-down version of its smart grid pilot, although how it would pay for the project remains unclear.

National Grid revealed its plans Monday in a letter to the state Public Service Commission. The letter argues that the PSC, which regulates utilities in New York, should keep details of its smart grid plan secret. The Times Union has been seeking to have specifics of the plan made public after large portions were blacked out by the utility.

But PSC Secretary Jaclyn Brilling ruled last month that details could be kept secret until after the stimulus funding was awarded because disclosure could put National Grid at a negotiating disadvantage with potential suppliers to the project — and that would hurt ratepayers who are funding half of the project.

Now National Grid has sent Brilling a letter asking her to continue to keep those key portions secret because it may try to do a scaled-down version in the future or one that is phased in over time.

"National Grid is aggressively evaluating a strategy by which it could pursue its proposed New York Smart Grid Program in some shape or fashion... with the desire to establish a proposed revised course of action early in 2010," National Grid attorney Catherine Nesser wrote in a letter to Brilling.

National Grid spokesman Patrick Stella said Tuesday that the utility hasn't decided how a smaller project would be funded or what it would entail in terms of technology.

"I don't think we know what that's going to look like or what we are looking at right now," Stella said.

On Tuesday, National Grid also learned that another project it is working on to test large utility-scale batteries in Massachusetts and Syracuse with a company called Premium Power Corp. received $7.3 million in stimulus funding.

The PSC approved National Grid's smart grid plan earlier this year and authorized it to charge customers a special fee to pay for it only if it were able to get the matching federal funds. Such smart grid technologies are expected to give customers more control over their energy usage and provide the utility with more information about its systems, especially outages.

PSC spokeswoman Anne Dalton said the PSC would consider any new smart grid plan by National Grid only after it files another application.